Although coverage of the 2024 election was dominated by the economy, taxes didn’t get much attention in the run-up to the vote. That’s a bit of a surprise, since 2025 will be a major year for America’s tax system – in fact, the fate of the most significant tax reform in three decades hangs in the balance.
That would be the Tax Cuts and Jobs Act, which Congress passed during President-elect Donald Trump’s first term in office in 2017. If lawmakers don’t take action, the whole package is set to expire at the end of next year. Western Governors University School of Business tax expert Jim Franklin explains what might be in store for the act, and for taxpayers.
What do the election results mean for Republicans’ ability to advance their tax agenda?
We know there will be a Republican president, and it appears the Republican Party will have the majority in both chambers of Congress. That means Republicans will be able to pass a tax bill along party lines, similar to how Democrats passed the Inflation Reduction Act using budget reconciliation.
This would allow Republicans to pass key policies with a simple majority. The Republican majority is narrow, so it will be interesting to see how the leaders unify their constituent groups.
Republicans have traditionally supported lower tax rates for businesses and individuals, as well as tax incentives to help boost economic activity.
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